Allowed

Nexus Select Trust (“Acquirer Reit”), acting through its investment manager, Nexus Select Mall Management Private Limited

CCI13 Feb 2023C-2022/11/986

Case brief

AI extract

What is this about?

The Competition Commission of India approved a proposed combination by Nexus Select Trust, a REIT, regarding its acquisition of commercial real estate assets and related entity shareholdings. The Commission found the combination unlikely to cause appreciable adverse effect on competition.

What did the court decide?

The proposed combination was approved under Section 31(1) of the Competition Act, 2002.

Nexus Select Trust (“Acquirer Reit”), acting through its… — Company and Corporate | CCI (2023)

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COMPETITION COMMISSION OF INDIA (Combination Registration No. C-2022/11/986)

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13^th February 2023

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Notice under Section 6(2) of the Competition Act, 2002, filed by Nexus Select Trust through its manager, Nexus Select Mall Management Private Limited.

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CORAM :

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Ms. Sangeeta Verma Acting Chairperson

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Mr. Bhagwant Singh Bishnoi Member

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Order under Section 31(1) of the Competition Act, 2002

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On 24^th November 2022, the Competition Commission of India (“ Commission ”) received a notice under Section 6(2) of the Competition Act, 2002 (“ Act ”), given by Nexus Select Trust (“ Acquirer ”), through its manager, Nexus Select Mall Management Private Limited, regarding its proposed acquisition of certain commercial real estate assets. The Acquirer is a Real Estate Investment Trust ( REIT ) registered with the Securities and Exchange Board of India ( SEBI ) under the SEBI (REIT) Regulations, 2014 (“ REIT Regulations ”).

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The proposed combination involves:

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2.1. Initial Portfolio Acquisition Transactions : (i) direct acquisition of 100% shareholding of (a) Chitrali Properties Private Limited; (b) CSJ Infrastructure Private Limited; (c) Euthoria Developers Private Limited; (d) Nexus Hyderabad Retail Private Limited; (e) Naman Mall Management Company Private Limited;

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(g) Nexus Mangalore Retail Private Limited; (f) Nexus Mysore Retail Private Limited; (g) Nexus South Mall Management Private Limited; (h) Nexus Shantiniketan Retail Private Limited; (i) Nexus Udaipur Retail Private Limited; (j) Nexusmalls Whitefield Private Limited; (k) Safari Retreats Private Limited; (l) Vijaya Productions Private Limited; (m) Daksha Infrastructure Private Limited ( DIPL ); and (n) Select Infrastructure Private Limited ( SIPL ) by the Acquirer REIT (acting through its manager) from the Sponsor Group¹ , the shareholders of SIPL and certain third party shareholders; (ii) indirect acquisition by the Acquirer REIT (acting through its manager) of 100% shareholding of Westerly Retail Private Limited [through SIPL] and Mamadapur Solar Private Limited [through NSMMPL]; and (iii) acquisition by the Acquirer (acting through its Manager) of 50% of the equity shares of Indore Treasure Island Private Limited ( ITIPL ) from certain members of the Sponsor Group;

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2.2. Unit Allotment : The Sponsor² , the Sponsor Group, the shareholders of SIPL and certain third-party shareholders of the target entities, will be issued units of the Acquirer REIT in consideration for the transfer of their shareholding in the target entities to the Acquirer REIT (acting through its manager).

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2.3. Listing of Units : The Acquirer will undertake an initial public offering (IPO) and list its units on recognised stock exchanges in India. Under Regulation 11(3) of the REIT Regulations, the Sponsor and Sponsor Group must collectively hold at least 15% unitholding of the Acquirer REIT, after the issue of units through IPO.

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1 As per the notice filed under Section 6(2) of the Act, the term “Sponsor Group” has been defined to mean: (a) SSIII Indian Investments One Ltd., (b) BREP Asia SG Alpha Holding (NQ) Pte. Ltd., (c) BREP Asia SG Red Fort Holding (NQ) Pte. Ltd., (d) BREP Asia SBS Red Fort Holding (NQ) Ltd., (e) BREP VIII SBS Red Fort Holding (NQ) Ltd., (f) BREP Asia SG Forum Holding (NQ) Pte. Ltd., (g) BREP Asia SBS Forum Holding (NQ) Ltd., (h) BREP VIII SBS Forum Holding (NQ) Ltd., (i) BREP Asia SG Kohinoor Holding (NQ) Pte. Ltd., (j) BREP Asia SBS Kohinoor Holding (NQ) Ltd., (k) BREP VIII SBS Kohinoor Holding (NQ) Ltd., (l) BRE Coimbatore Retail Holdings Ltd., (m) BREP Asia SBS Coimbatore Retail Holding (NQ) Ltd., (n) BREP VIII SBS Coimbatore Retail Holding (NQ) Ltd., and (o) BREP Asia II Indian Holding Co. IX (NQ) Pte. Ltd. 2 Wynford Investments Limited

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Post the proposed combination, the Acquirer will be a listed entity with public investors as well as the Sponsor, the Sponsor Group, and the shareholders of SIPL holding units. All the target entities in the initial portfolio acquisition transactions, except DIPL, SIPL, and ITIPL, are entities controlled by funds advised and/or managed by affiliates of Blackstone Inc., a global alternative asset manager (“ Blackstone Entities ”). These target entities largely own and operate commercial real estate assets in several cities across India, including the National Capital Region (NCR) and Pune.

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SIPL constructs malls and provides services to the users of retail shops and the occupiers of malls. SIPL owns and operates a mall by the name of Select CITYWALK in Saket, New Delhi. Other than certain units sold to third parties, SIPL owns retail space in Select CITYWALK with a view to let the same out on lease or licence.

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DIPL, one of the target entities, owns and operates commercial real estate assets in the city of Pune, Maharashtra. It is also stated to operate a renewable power plant in Solapur, Maharashtra.

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ITIPL, another target entity, is also engaged in the business of operating commercial real estate. It presently operates an urban consumption centre in Indore, Madhya Pradesh.

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By way of the proposed combination, the businesses of the target entities pool their commercial real estate assets under the Acquirer. In lieu of the same, the shareholders of the target entities would receive units issued by the Acquirer. As per the information provided in the notice, the activities of Blackstone Entities overlap with the business of DIPL in Pune region and with the business of SIPL in NCR region. However, the market position of DIPL and SIPL, in the respective regions, does not appear to be significant in the business of commercial real estate. It is further noted that these regions also have the presence of several other similarly placed players. These suggest that the proposed combination is not likely to raise any competition concerns.

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Considering the material on record, including the details provided in the notice and the assessment of the proposed combination based on factors stated in Section 20(4) of the Act, the Commission is of the opinion that the proposed combination is not likely to have any appreciable adverse effect on competition in India. Therefore, the Commission approves the proposed combination under Section 31(1) of the Act.

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This order may be revoked if, at any time, the information provided by the Acquirer is found to be incorrect.

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The information provided by the Acquirer shall be treated as confidential in terms of and subject to the provisions of Section 57 of the Act.

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The Secretary is directed to communicate to the Acquirer accordingly.

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Nexus Select Trust (“Acquirer Reit”), acting through its investment manager, Nexus Select Mall Management Private Limited

Case brief

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Nexus Select Trust (“Acquirer Reit”), acting through its investment manager, Nexus Select Mall Management Private Limited

Case brief

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